Prefer establishing wholly owned subsidiaries

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Reference no: EM132034575

1. Why do firms pursuing global standardization or transnational strategies tend to prefer establishing wholly owned subsidiaries?

A. It gives firms sound knowledge of the local markets, culture, and the political environment.

B. It helps protect competitive advantages based on technology.

C. It allows firms to use the profits generated in one market to improve its competitive position in another market.

D. It is the most politically accepted mode of entry into foreign markets.

E. It has the least costs and risks associated with developing a foreign market.

2. Aquila (a utility) has a PE of 6.7, a 5-year earnings growth rate of 7.5%, and a dividend yield of 7.4%. Aquila is a likely investment for which type of mutual fund?

a. Growth fund

b. Value fund

c. Income fund

d. Bond fund

Reference no: EM132034575

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